VANCOUVER, British Columbia,
September 11, 2017 /PRNewswire/
--
Eldorado Gold Corporation ('Eldorado' or the 'Company') today announces
plans to suspend investment at its operating mines, development
projects and exploration assets in Greece.
Despite repeated attempts by Eldorado and its Greek subsidiary,
Hellas Gold, to engage
constructively with the Greek government, the Ministry of Energy
and Environment (the 'Ministry') and other government agencies,
delays continue in issuing routine permits and licences for the
construction and development of the Skouries and Olympias projects
in Halkidiki, northern Greece.
These permitting delays have negatively impacted Eldorado's project schedules and costs,
ultimately hindering the Company's ability to effectively advance
development and operation of these assets.
With the exception of a care and maintenance program and
necessary environmental safeguarding costs, Eldorado and its Board of Directors have
decided that under present conditions no additional investment will
be made into the Kassandra Mines (Olympias, Skouries, Stratoni) in
Halkidiki, the Perama Hill and Sapes projects in Thrace, and any
exploration activity in the country. Funds that were budgeted to be
invested into community spending and infrastructure development
will be phased out. Similarly, tax revenues at the municipal,
regional and national levels will also be affected.
Actions will be taken to place the Skouries and Olympias
projects and the Stratoni mine on care and maintenance starting on
September 22, 2017. Suspension
and termination of contractors and employees will be done in
accordance with applicable labour regulations in Greece. Environmental protection works and
care and maintenance activities will continue in order to safeguard
the environment and the assets. The Company estimates that a total
of US$30 million will be spent to
prepare for care and maintenance activities, with sustaining
maintenance costs of approximately US$25
million annually.
The Company is also awaiting additional detail from the Greek
government regarding the pending arbitration process. Eldorado
has not yet received formal notification of arbitration but is
confident that any potential arbitration will again demonstrate the
Company's adherence to all applicable laws and regulations. The
Council of State (Greece's highest
court on environmental and administrative matters) has repeatedly
confirmed the legitimacy of our permits and actions with 18
decisions in the Company's favour.
The Company would re-assess its investment options in
Greece upon approval and receipt
of the required permits, coupled with a supportive government open
to discussions surrounding the use and implementation of best
available technologies.
George Burns, President and Chief
Executive Officer of Eldorado Gold, commented:
"It is extremely unfortunate to find ourselves at this impasse
when we should be advancing an important commercial project in
partnership with Greece and adding
another 1,200 jobs to our current workforce of approximately 2,400
people in Greece. Eldorado's investment in Greece is about building a world-class
operation that can exist as a long-term partner to Greece and has the ability to promote advanced
skills and training for its people and deliver well-paying jobs to
sustain families and local businesses. Of equal importance, as
a commercial partner, this business can provide much-needed tax and
export revenue for generations."
"Eldorado has been a committed,
responsible and patient partner to the Greek government and the
people of Greece. Since acquiring the Kassandra Mines for
nearly $2 billion in 2012,
Eldorado has invested an
additional $1 billion in the
country. That figure would double if Eldorado were able to fully develop its
Olympias, Skouries and Perama Hill assets. However, as a
result of the delay in issuing permits by the Greek government,
Eldorado is unable to continue
investing in the country. We have a responsibility to our
shareholders to allocate capital to projects not only with the best
rates of return, but also in locations where host governments are
supportive of our investment and work with us to grow a sustainable
future. As such, Eldorado
cannot continue to put capital at risk without these permits and
will pursue all avenues to advance its investment and contractual
rights."
"Should the Greek government wish to work within the framework
of its contractual obligations with Hellas
Gold, issue permits in a timely manner and support the
investment, Eldorado will then be
in a position to re-evaluate its investment plans in the
country."
Skouries Project (Halkidiki)
Construction and development activities at the Skouries project,
with over $350 million invested
to-date and a current workforce of 530 people including
contractors, will be suspended effective September 22, 2017.
Olympias Project (Halkidiki)
The refurbished Olympias processing plant is close to completing
the commissioning phase and commercial production from Phase 2 was
planned during the fourth quarter 2017. Current headcount at
Olympias is approximately 950 people including
contractors. Commissioning work and further development
activity will be suspended effective September 22, 2017. To date, Eldorado has invested over $400 million at Olympias.
Stratoni Mine (Halkidiki)
The Stratoni Mine currently employs approximately 830 people
including contractors and had a life of mine of approximately one
year based on known proven and probable reserves at the beginning
of 2017. Geological potential exists to expand resources and
extend mine life and Eldorado is
currently undertaking a drilling campaign to test the lower portion
of the Mavres Petres orebody. Additional investment would be
required over the next two years to further delineate additional
resources. All mining operations and exploration activities will be
suspended effective September 22,
2017.
Perama Hill and Sapes Projects (Thrace)
Perama Hill and Sapes are currently on care and maintenance
pending approvals by the Ministry of Energy and the Environment for
Perama Hill's Environmental Impact Study and for Sapes' drilling
permit, both of which have been pending for over three years.
Press Conference
George Burns, President & CEO
of Eldorado Gold will host a press conference at the Athens Hilton
Hotel today, September 11, 2017 at
11:00 AM local time (GMT+2) to
discuss Eldorado's amended
investment plans in Greece. His speech will be available
shortly after the press conference
at http://www.eldoradogold.com.
Conference Call
George Burns will host a
conference call today, September 11,
2017 at 8:00 AM ET
(5:00 AM PT) to discuss Eldorado's amended investment plans in
Greece. The call will be webcast
and can be accessed at http://www.eldoradogold.com.
Conference Call Details Replay (available until September 25, 2017)
Date: Monday, September
11, 2017 Toronto: 416-849-0833
Time: 8:00 am ET (5:00 am Toll Free: 855-859-2056
PT) Pass code: 828-838-97
Dial in: 647-427-7450
Toll free: 888-231-8191
About Eldorado Gold
Eldorado is a leading
intermediate gold producer with mining, development and exploration
operations in Turkey, Greece, Romania, Serbia, Canada and Brazil. The Company's success
to date is based on a highly skilled and dedicated workforce, safe
and responsible operations, a portfolio of high-quality assets, and
long-term partnerships with the communities where it
operates. Eldorado's common shares trade on the Toronto Stock
Exchange (TSX: ELD) and the New York Stock Exchange (NYSE:
EGO).
Cautionary Note about Forward-looking Statements and
Information
Certain of the statements made and information provided in this
press release are forward-looking statements or information within
the meaning of the United States Private Securities Litigation
Reform Act of 1995 and applicable Canadian securities laws. Often,
these forward-looking statements and forward-looking information
can be identified by the use of words such as "plans",
"expects", "is expected", "budget", "continue",
"projected", "scheduled", "estimates", "forecasts", "intends",
"anticipates", or "believes" or the negatives thereof or variations
of such words and phrases or statements that certain actions,
events or results "may", "could", "would", "might" or "will" be
taken, occur or be achieved.
Forward-looking statements or information contained in this
release include, but are not limited to the Company's Amended
Investment Plans in Greece,
including statements or information with respect
to: our guidance and outlook, including expected
production, projected cash cost, planned capital and exploration
expenditures for 2017; our expectation as to our future financial
and operating performance, including future cash flow, estimated
cash costs, expected metallurgical recoveries, gold price outlook;
and our strategy, plans and goals, including our proposed
exploration, development, construction, permitting and operating
plans and priorities, and related timelines.
Forward-looking statements and forward-looking information by
their nature are based on assumptions and involve known and unknown
risks, uncertainties and other factors which may cause the actual
results, performance or achievements of the Company to be
materially different from any future results, performance or
achievements expressed or implied by such forward-looking
statements or information.
We have made certain assumptions about the forward-looking
statements and information, including assumptions about the
geopolitical, economic, permitting and legal climate that we
operate in; the future price of gold and other commodities;
exchange rates; anticipated costs and expenses; production, mineral
reserves and resources and metallurgical recoveries, the impact of
acquisitions, dispositions, suspensions or delays on our business
and the ability to achieve our goals. In
particular, except where otherwise stated, we have assumed a
continuation of existing business operations on substantially the
same basis as exists at the time of this release.
Even though our management believes that the assumptions made
and the expectations represented by such statements or information
are reasonable, there can be no assurance that the forward-looking
statement or information will prove to be accurate. Many
assumptions may be difficult to predict and are beyond our
control.
Furthermore, should one or more of the risks, uncertainties
or other factors materialize, or should underlying assumptions
prove incorrect, actual results may vary materially from those
described in forward-looking statements or
information. These risks, uncertainties and other
factors include, among others, the
following: geopolitical and economic climate (global
and local), risks related to mineral tenure and permits; gold and
other metal price volatility; mining operational and development
risk; foreign country operational risks; risks of sovereign
investment; regulatory environment and restrictions, including
environmental regulatory restrictions and liability; discrepancies
between actual and estimated production, mineral reserves and
resources and metallurgical recoveries; risks related to impact of
the sale of our Chinese assets and the acquisition of Integra on
the Company's operations; risks related to impact of the
integration of Integra; additional funding requirements; currency
fluctuations; litigation risks; community and non-governmental
organization actions; speculative nature of gold exploration;
dilution; share price volatility; competition; loss of key
employees; and defective title to mineral claims or property, as
well as those factors discussed in the sections entitled
"Forward-Looking Statements" and "Risk factors in our business" in
the Company's most recent Annual Information Form
& Form 40-F. The reader is directed to carefully review the
detailed risk discussion in our most recent Annual Information Form
filed on SEDAR under our Company name, which discussion is
incorporated by reference in this release, for a fuller
understanding of the risks and uncertainties that affect the
Company's business and operations.
Forward-looking statements and information is designed to
help you understand management's current views of our near and
longer term prospects, and it may not be appropriate for other
purposes.
There can be no assurance that forward-looking statements or
information will prove to be accurate, as actual results and future
events could differ materially from those anticipated in
such statements. Accordingly, you should not place
undue reliance on the forward-looking statements or
information contained herein. Except as required by
law, we do not expect to update forward-looking statements and
information continually as conditions change and you are referred
to the full discussion of the Company's business contained in the
Company's reports filed with the securities regulatory authorities
in Canada and the
U.S.
Financial Information and condensed statements contained
herein or attached hereto may not be suitable for readers that are
unfamiliar with the Company and is not a substitute for reading the
full annual financial statements and related MD&A available on
our website and on SEDAR under our Company
name. The reader is directed to carefully review such
document for a full understanding of the financial information
summarized herein.
Investor Relations:
Krista Muhr
Vice President Investor Relations & Corporate
Communications
+1-604-607-6701 or +1-888-363-8166
kristam@eldoradogold.com
Media:
Louise Burgess
Director Communications & Government Relations
+1-604-616-2296
louiseb@eldoradogold.com